CA Reports Solid Q4 and Fiscal Year 2007 Results

Announces Intention to Repurchase Up to $500 Million in Common StockCompany Will Hold Webcast at 5 p.m. ET

ISLANDIA, N.Y.--(BUSINESS WIRE)--May 23, 2007--CA (NYSE:CA), one
of the world's largest management software companies, today announced
results for its fourth quarter and full year fiscal 2007, which ended
March 31, 2007.

"I am pleased with CA's execution in the second half of the 2007
fiscal year as we met or exceeded our full-year guidance for total
revenue, non-GAAP earnings per share, total product and services
bookings and cash flow from operations," said John Swainson, CA
president and chief executive officer. "Our solid performance was a
result of our increased focus on execution in all areas of our
business, with particular emphasis on our restructuring and cost
savings efforts, go-to-market strategy and an improved operational
focus.

"Over the last 12 months, we have refreshed virtually all our
major product lines and at CA WORLD in April introduced 16 Capability
Solutions based on our Enterprise IT Management vision," Swainson
continued. "We are seeing increased demand for our infrastructure
management, business service optimization and security management
offerings, which help our customers govern, manage and secure their IT
environments. I am confident that we have the right technology vision,
products and solutions and senior management team to continue our
momentum from the second half of fiscal 2007.

"I am also very pleased that CA has successfully concluded the
Deferred Prosecution Agreement," Swainson said. "As a result of the
hard work of all CA employees, we are now a stronger company and are
moving forward with a sense of vigor and enthusiasm to becoming one of
the world's most successful software companies."

Fourth Quarter and Full-Year Results

Revenue for the fourth quarter was $1.005 billion, an increase of
7 percent, or 4 percent in constant currency, over the $942 million in
the comparable prior year period. Aside from the gains attributed to
currency, the increase in revenue primarily came from growth in
subscription revenue and professional services. The increase was
partially offset by decreases in software fees and other revenue,
maintenance and financing fee revenue as CA continues to transition
from its prior business model. Revenue from professional services was
up 3 percent over the comparable prior year period.

Total North America revenue was up 6 percent while revenue from
international operations was down approximately 2 percent on a
constant currency basis.

For the full year, revenue was $3.943 billion, up 5 percent, or 3
percent in constant currency, compared to the $3.772 billion reported
in fiscal year 2006. As in the fourth quarter, the increase primarily
was due to growth in subscription revenue and professional services
revenue. Those increases partly were offset by declines in software
fees and other revenue, maintenance and financing fee revenue.

Subscription revenue for the fourth quarter was $793 million, an
increase of 11 percent, or 8 percent in constant currency, over the
$715 million reported in the prior year period. Subscription revenue
accounted for 79 percent of total revenue, compared to 76 percent
reported in the comparable prior year period. For the fiscal year,
subscription revenue was $3.067 billion, an increase of 8 percent, or
7 percent in constant currency, compared to the $2.837 billion
reported in the prior year period. Subscription revenue accounted for
78 percent of total revenue, compared to 75 percent reported in the
2006 fiscal year.

Total product and services bookings in the fourth quarter were
$1.133 billion, and for the full year, bookings were $3.938 billion.
This represents a year-over-year decline of 5 percent from the $1.192
billion reported in the fourth quarter of fiscal year 2006 and an
increase of 16 percent from the $3.381 billion reported for the full
2006 fiscal year. The decrease in fourth quarter bookings
year-over-year can be attributed, in part, to very strong bookings in
the third quarter, which decreased the number of contracts that were
available to be renewed in the fourth quarter of fiscal year 2007.

The weighted average duration of new direct bookings in fiscal
year 2007 was 3.29 years, compared to 3.03 years in fiscal year 2006.

Total expenses, before interest and taxes, for the fourth quarter
were $1.017 billion, up 3 percent, compared with $988 million in the
prior year period. In the quarter, the Company experienced
significantly higher restructuring and other costs and expenses
associated with the delivery of professional services compared to the
prior year period as well as an increase in bonus expenditures. This
was offset partially by significantly lower sales commission expense
and amortization of capitalized software costs.

On a non-GAAP basis, the Company reported fourth quarter operating
expenses of $830 million, which excludes restructuring and other costs
and amortization costs, down 2 percent from the $851 million reported
in the prior year period. This decreased expense level for the fourth
quarter reflects lower sales commission and promotion expenses and
progress on expense management initiatives, offset by higher expenses
associated with the delivery of professional services.

For the full year, total expenses, before interest and taxes, were
$3.729 billion, up 3 percent from the $3.606 billion reported for
fiscal 2006. The Company experienced significantly higher
restructuring and other expenses and costs associated with the
delivery of professional services in fiscal year 2007 as compared to
fiscal year 2006, as well as an increase in bonuses expenditures. This
was offset partially by lower commissions expense and lower
amortization of capitalized software costs.

The fourth quarter of fiscal year 2007 included restructuring and
other charges of $100 million, of which $71 million was related to
severance costs and $8 million associated with the closure of
facilities under the fiscal year 2007 cost reduction and restructuring
plan. For the full year, the Company recorded restructuring and other
costs of $201 million. The fiscal year 2007 total includes $147
million in costs associated with the Company's fiscal year 2007 cost
reduction and restructuring plan and $19 million in costs associated
with the Company's fiscal year 2006 cost reduction and restructuring
plan.

On a non-GAAP basis, the Company reported full-year operating
expenses for fiscal year 2007 of $3.160 billion, up 4 percent from the
$3.048 billion reported in fiscal year 2006. A reconciliation of GAAP
expenses to non-GAAP expenses is included in the tables following this
news release.

The Company recorded a GAAP loss from continuing operations of $20
million for the fourth quarter, or ($0.04) per diluted common share,
compared to a loss of $39 million, or ($0.07) per diluted common
share, in the prior year period. As stated above, the fourth quarter
GAAP results were adversely affected by $79 million in charges
associated with its fiscal year 2007 cost reduction and restructuring
plan. For the full year, GAAP income from continuing operations was
$121 million, or $0.22 per diluted common share, compared to $160
million, or $0.27 per diluted common share, in fiscal year 2006. The
decrease can be primarily attributed to the costs associated with the
Company's cost reduction and restructuring program.

The Company recorded non-GAAP net income from continuing
operations of $109 million for the fourth quarter, or $0.20 per
diluted common share, compared to $81 million, or $0.13 per diluted
common share, reported a year earlier. For the full year, non-GAAP
income from continuing operations was $499 million, or $0.88 per
diluted common share, compared to $514 million, or $0.85 per diluted
common share, reported in fiscal year 2006. A reconciliation of GAAP
income from continuing operations to non-GAAP income from continuing
operations is included in the tables following this news release.

For the fourth quarter of fiscal year 2007, CA reported $521
million in cash flow from operations, down 8 percent from the $566
million reported in the prior year period. On a comparable basis,
fourth quarter non-GAAP adjusted cash flow from operations was $551
million adjusted for $30 million in restructuring and other payments,
versus $648 million reported in the prior year adjusted for a $75
million payment to the Restitution Fund and $7 million in
restructuring and other payments.

Fourth quarter cash flow was affected negatively by a lower volume
of bookings and associated billings, and a year-over-year reduction in
the aggregate amount of single installment contract payments over the
comparable period last fiscal year.

For the full year, cash flow from operations was $1.068 billion,
compared to $1.380 billion in the prior period. The Company exceeded
cash flow from operations guidance, in part, due to the positive
impact of $90 million in lower-than-expected tax payments in the
fourth quarter--the majority of which the Company now expects to pay
in the first half of fiscal 2008. The full-year cash flow also was
affected by a decrease in the average time it took the Company to pay
vendors for products and services, higher expenses, and increased
restructuring costs. In addition, cash flow also was negatively
affected by contributions to CA's employee 401(k) savings plan in
fiscal year 2007 that were not made in the prior fiscal year.

On a comparable basis, non-GAAP adjusted cash flow from operations
for the full year, adjusted for $94 million in restructuring and other
payments, was $1.162 billion, compared to $1.552 billion, adjusted for
$150 million in payments to the Restitution Fund and $22 million in
restructuring payments, reported in fiscal year 2006.

Capital Structure

The balance of cash and marketable securities at March 31, 2007,
was $2.280 billion. With $2.583 billion in total debt outstanding, the
Company has a net debt position of approximately $303 million.

Over the course of fiscal year 2007, CA repurchased approximately
51 million shares of its common stock at an aggregate cost of
approximately $1.2 billion.

The Company also announced that it currently is in the process of
executing an accelerated share repurchase of up to $500 million in
common shares. The transaction will be financed with existing cash.

"Our decision to continue our stock repurchases is an indication
of our confidence in CA's ability to generate healthy cash flows and
in our long-term business position," said Nancy Cooper, CA's chief
financial officer. "The program also speaks to our strategy of
balancing the way we allocate our capital."

Outlook for Fiscal Year 2008

The following annual outlook is based on current expectations and
represents "forward-looking statements" (as defined below).

Total revenue in the range of $4.050 billion to $4.100 billion
or 3 percent to 4 percent growth in constant currency;

GAAP earnings per share from continuing operations between
$0.75 and $0.79;

Non-GAAP operating earnings per share* for the full year to be
in the range of $0.94 to $0.98; and,

Full-year cash flow from operations in the range of $1.050
billion to $1.100 billion.

There are several items which will affect the fiscal year 2008
cash flow guidance. The Company expects a total of approximately $470
million in cash tax payments during fiscal year 2008. This reflects an
increase of $170 million year-over-year, of which $70 million the
Company previously expected to pay in fiscal year 2007. CA expects a
reduction of approximately $20 million principally as a result of
reduced interest income due to the share repurchase program and
restructuring payments in excess of $80 million.

The revenue and EPS guidance is based on current exchange rates
and assumes that the Company will make no acquisitions in fiscal year
2008. The guidance also includes the anticipated slightly dilutive
impact of the share repurchase program. The Company anticipates an
average diluted share count of approximately 542 million shares, and a
full-year non-GAAP tax rate of approximately 33 percent.

The Company indicated that it expects cash flow from continuing
operations in the first quarter of fiscal year 2008 will be negative
as the result of a decrease in cash collections of approximately $85
million due to fewer fourth quarter of fiscal 2007 single installment
contracts and associated lower billings. The Company also expects
additional tax payments of approximately $50 million that were
originally planned for the fourth quarter of fiscal 2007. These
factors have been included in CA's fiscal year 2008 cash flow from
operations guidance.

*Operating earnings per share is a non-GAAP financial measure, as
noted in the discussion of non-GAAP results above. A reconciliation of
GAAP earnings per share to non-GAAP earnings per share is included in
the tables following this news release.

Webcast

This press release and the accompanying tables should be read in
conjunction with additional content that is available on the Company's
website, including a supplemental financial package and related slide
presentation, as well as a webcast that the Company will host at 5
p.m. ET today to discuss its fourth quarter and full-year 2007
results. The webcast will be archived on the website. Individuals can
access the webcast, as well as this press release and supplemental
financial information, at http://ca.com/invest or listen to the call
at 1-888-576-4172. International participants can listen to the call
at 1-706-902-0518.

About CA

CA (NYSE:CA), one of the world's largest information technology
(IT) management software companies, unifies and simplifies the
management of enterprise-wide IT. Founded in 1976, CA is headquartered
in Islandia, N.Y., and serves customers in more than 140 countries.
For more information, please visit http://ca.com.

Non-GAAP Financial Measures

This news release, the accompanying tables and the additional
content that is available on the Company's website, including a
supplemental financial package, include financial measures for per
share earnings and cash flows that exclude the impact of certain items
and therefore have not been calculated in accordance with U.S.
generally accepted accounting principles (GAAP). Non-GAAP "operating"
earnings per share excludes the following items: non-cash amortization
of acquired technology and other intangibles, in process research and
development charges, restructuring and other charges and the tax
resulting from the repatriation of approximately $584 million of
foreign cash and interest on dilutive convertible bonds (the
convertible shares, rather than the interest, are more dilutive, thus
the interest is added back and the shares increased to calculate
non-GAAP operating earnings). Non-GAAP taxes are provided based on the
estimated effective annual non-GAAP tax rate. Non-GAAP adjusted cash
flow excludes the following items: Restitution Fund payments,
restructuring and other payments, and the impact of certain
non-recurring tax payments or tax benefits. Free cash flow excludes
capital expenditures. These non-GAAP financial measures may be
different from non-GAAP financial measures used by other companies.
Non-GAAP financial measures should not be considered as a substitute
for, or superior to, measures of financial performance prepared in
accordance with GAAP. By excluding these items, non-GAAP financial
measures facilitate management's internal comparisons to the Company's
historical operating results and cash flows, to competitors' operating
results and cash flows, and to estimates made by securities analysts.
Management uses these non-GAAP financial measures internally to
evaluate its performance and they are key variables in determining
management incentive compensation. The Company believes these non-GAAP
financial measures are useful to investors in allowing for greater
transparency of supplemental information used by management in its
financial and operational decision-making. In addition, the Company
has historically reported similar non-GAAP financial measures to its
investors and believes that the inclusion of comparative numbers
provides consistency in its financial reporting. Investors are
encouraged to review the reconciliation of the non-GAAP financial
measures used in this news release to their most directly comparable
GAAP financial measures, which are attached to this news release.

Cautionary Statement Regarding Forward-Looking Statements

Certain statements in this communication (such as statements
containing the words "believes," "plans," "anticipates," "expects,"
"estimates" and similar expressions) constitute "forward-looking
statements." A number of important factors could cause actual results
or events to differ materially from those indicated by such
forward-looking statements, including: changes to the CA incentive
compensation plan, sales organization and sales coverage model may
lead to outcomes that are not anticipated or intended as they are
implemented; CA may not adequately manage and evolve its financial
reporting and managerial systems and processes, including the
successful implementation of its enterprise resource planning
software; CA may encounter difficulty in successfully integrating
acquired companies and products into its existing businesses; CA is
subject to intense competition in product and service offerings and
pricing and increased competition is expected in the future; if CA's
products do not remain compatible with ever-changing operating
environments, CA could lose customers and the demand for CA's products
and services could decrease; certain software that CA uses in daily
operations is licensed from third parties and thus may not be
available to CA in the future, which has the potential to delay
product development and production; CA's credit ratings have been
downgraded and could be downgraded further which would require CA to
pay additional interest under its credit agreement and could adversely
affect CA's ability to borrow; CA has a significant amount of debt;
the failure to protect CA's intellectual property rights would weaken
its competitive position; CA may become dependent upon large
transactions; CA's sales to government clients subject it to risks,
including early termination, audits, investigations, sanctions and
penalties; general economic conditions may lead CA's customers to
delay or forgo technology upgrades; the market for some or all of CA's
key product areas may not grow; third parties could claim that CA's
products infringe their intellectual property rights or that CA owes
royalty payments; fluctuations in foreign currencies could result in
translation losses; CA has outsourced various functions to third
parties and these arrangements may not be successful; and the other
factors described in CA's filings with the Securities and Exchange
Commission. CA assumes no obligation to update the information in this
communication, except as otherwise required by law. Readers are
cautioned not to place undue reliance on these forward-looking
statements that speak only as of the date hereof.

Refer to the discussion of Non-GAAP measures included in the
accompanying press release for additional information.
(1) Reflects estimated total restructuring and other charges of $30
million for fiscal year 2008. The actual amount incurred may differ
from this amount.